LONDON - Royal Bank of Scotland reported a net loss Friday of £1.99 billion, or $3.08 billion, in the first half of the year after it took an accounting charge on its debt and other one-off charges.
The Edinburgh-based bank, which is 82 percent owned by the British government after receiving a bailout, set aside £125 million to compensate customers for a recent technology problem and a further £135 million for the inappropriate selling of insurance to clients.
Royal Bank of Scotland said regulators continued to investigate its role in the manipulation of the London interbank offered rate, or Libor.
The firm has dismissed a number of individuals in relation to the inquiries, while several of its employees have been named as defendants in American lawsuits connected to the rate-rigging scandal, according to a company statement.
The bank said it could not estimate the amount of future potential fines or when any announcement connected to the Libor investigations would be made.
“We are in a chastening period for the banking industry,†Royal Bank of Scotland's chief executive, Stephen Hester, said in a statement. “The consequences of these mistakes have seen the reputation of the sector fall to new lows.â€
Royal Bank of Scotland's loss in the six months through June 30 came after it recorded a £2.97 billion accounting charge on its own debt. The first-half figures compared to a £1.42 billion loss over the same period last year. Revenue fell 8 percent, to £13.29 billion.
The bank's operations continued to suffer from weak consumer spending as the fallout from the European debt crisis affected the retail and corporate banking units.
Royal Bank of Scotland also has been paring back its investment banking division in response to the current economic climate. That unit reported a 29.6 percent drop its operating profit, to £264 million, in the first six mont hs of the year.
The British bank said it had cut its work force by 5,700 over the period, primarily from its markets and international banking division.
Royal Bank of Scotland has been slashing its assets to improve profitability, and it said it had cut its non-core assets by £22 billion, to £72 billion, during the first half of the year. That figure stood at £258 billion in September 2009.
The firm's core Tier 1 ratio, a measure of a bank's ability to weather financial shocks, rose slightly to 11.1 percent.
